Analysts predict Ethereums price may soon experience a parabolic surge
The Ethereum price has demonstrated resilience in recent days as the likelihood of spot ETF approvals increases. On Friday, the ETH token was trading at $3,455, slightly above its weekly low of $3,233, and remains within a correction zone following a 13% decline from its peak this month.
The key driver for Ethereum is the anticipated approval of spot Ethereum ETFs by the Securities and Exchange Commission (SEC). This growing anticipation was sparked by VanEck’s filing of form 8-A, a crucial document in the ETF application process. Bloomberg’s senior ETF analyst, Eric Balchunas, believes that these funds will begin trading on July 2nd.
The approval of spot Ethereum ETFs would be significant, considering the strong demand for cryptocurrencies from institutional investors, as seen with Bitcoin. The Grayscale Ethereum Trust (ETHE), with a management fee of 2.50%, currently holds over $10 billion in assets. Consequently, lower-priced funds are likely to witness high demand from both retail and institutional investors.
The trading of Ethereum ETFs will coincide with a period of declining balances in exchanges, as illustrated by the chart below.
Despite the ongoing crypto sell-off, Ethereum’s ecosystem remains strong. The network boasts a total value locked (TVL) of over $108.95 billion and nearly $80 billion in stablecoins. Additionally, it has generated fees totaling $1.65 billion, surpassing the combined fees of Tron and Bitcoin.
Numerous analysts are optimistic about the future of the Ethereum price. Rekt Finance highlighted a rising open interest in Ethereum futures, indicating institutional demand ahead of the ETF approval. Furthermore, Ether is a deflationary asset that continuously reduces its supply over time. As a result, Rekt Finance expects ETH to experience a surge following the ETF approval, followed by a consolidation or pullback as Grayscale Ethereum Fund holders transition to more affordable options, before resuming its bullish trajectory.
Another prominent analyst, Crypto Rover, with over 700k followers, identified a descending channel pattern in Ethereum, resembling a falling wedge formation. This pattern typically supports upward potential, leading Crypto Rover to anticipate an imminent breakout.
